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GROUT BILL, TAXING OLEOMARGARINE AND 
IMITATIONS OF BUTTER. 



SPEECH 



HON. HENRY D.GREEN, 



OF PENNSYLVANIA, 



HOUSE OF REPRESENTATIVES, 



Monday, May 14, 1900. 



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ong. Record Oi? f *"' 
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S P E E C II 

OP 

IlOISr. HENRY D. GREEK", 

OF PENNSYLVANIA. 



The Houso being in Committee of the "Whole House on the state of the 
Union, and having under consideration the bill {H. R. 11537) making appro- 
priations to supply duflciencies in the appropriations for the fiscal year end- 
ing June 30, 1900, and for prior years, and for other purposes- 
Mr. GREEN of Pennsylvania said: 

Mr. Chairman: At the very beginning of this session of Con- 
gress, as far back as December 13, 1899, House bill No. 3717, fa- 
miliarly called the Grout bill, was referred to the Committee on 
Agriculture. 

It has remained there ever since, and, for all that 1 can find 
out, will remain there until the Fifty-sixth Congress ceases to 
exist, or at least until it will be too late to have the measure acted 
upon and enacted into law at this session. 

There can be no excuse for this unprecedented and needless 
delay. Sixty days would have been sufficient time to liear all the 
arguments for and against the measure. It is apparent that want 
of time to consider can not be urged as even a plausible excuse. 
What, then, is the reason for the delay? The bill is a very short 
one, the provisions are simple, the subject-matter is old, and the 
legal propositions involved have all been settled by the court of 
last resort. The people naturally suppose that the men wlio are 
appointed as members of the Committee on Agriculture are not 
onlj' familiar with the subject-matter of the questions coming 
under its jurisdiction, but are friendly to the passage of fair leg- 
islation which will protect and encourage that large portion of our 
people who are engaged in agricultural pursuits. 

To my personal knowledge, many individual members of this 
Househave seen personally the members of this committee and per- 
ils 8 



Bonally urged them to take prompt action on the pending measure. 
Speaking for myself, I know I have done everything in my power 
to have the friends of this measure make special efforts to report 
the bill promptly and favorably. 

From all the information I can obtain, the majority of that com- 
mittee are in favor of reporting the bill favorably. "When its 
friends outside of the committee expostulate and complain of the 
delay — the dangerous delay — the only answer we receive is in the 
way of excuses which do not excuse. 

Anyone, from the conduct of the committee in not reiDorting, 
from the poor excuses offered for the delay, from the assurances 
given of approval of the measure, is compelled to conclude that 
the members of the committee are individually for the bill and 
collectively against it. 

Their delay can be explained in but one of the following hypo- 
theses: 

First. The enemies of the bill, open or secret, constitute a ma- 
jority of the committee, despite their personal assurances to the 
contrary. 

Second. The friends of the bill, while they may be a numerical 
majority, are outmaneuvered by the oleomargarine supporters, 
and have not and are not managing their fight with skill. 

Third. That the friends of the bill are in a majority, yet by party 
orders or for supposed partisan capital are willing to allow the bill 
to be delayed so that final action may not be taken on the measure 
before the expiration of this session and before the question of the 
Presidency is again settled previous to the convening of Congress. 

It looks as though they wished to be able in the next Congres- 
sional and Presidential canvass to pose as both the friends of the 
oleomargarine trusts and the friends of the farming and dairy 
interests. 

Let me say to the Committee on Agriculture as well as to the 
members of this House that this straddle will not be successful. 

The farmers and dairymen of the United States are alive to 
their interests; they have taken a firm and uncompromising stand 
in their opposition to any longer delay in stamping out this fraud- 
ulent business, which so interferes with them that it threatens the 
very existence of the manufacture of pure dairy butter. 

They are well organized and each day are becoming better or- 

4193 



ganized. They stand shoulder to shoulder in this fight, willing 
to drop party lines if need be. 

They will solve the mystery of this delay. Time will disclose to 
them the real cause. Even the secrets of the committee room will 
leak out and become public propertj'. They will be able to sepa- 
rate their friends from their opponents and before the Fifty- 
seventh Congress is elected they will by their votes at the polls 
see that their interests are not put in jeopardy by either open 
enemies, lukewarm friends, or bungling management. 

It is said by members of the committee that the bill has been 
referred to a subcommittee of three, and that two out of the three 
members are enemies and have held back and continue to hold 
back the report. Will it not be hard to explain to the dairy inter- 
ests of this country what necessity there was to have a bill so plain 
in its provisions and so reaching in its character referred to any 
subcommittee? Surely this was a blunder. But it is easily cor- 
rected. The majority of the committee, which had power to refer 
to a subcommittee, surely have the power to order a report of that 
subcommittee, and in case of a refusal thej' can discharge them 
from all further consideration of the measure and take action. 
Nay, they can even take action and report the bill without con- 
sidering the fact of its submission to the subcommittee. This 
may not be a very courteous i^roceeding, but who will deny that 
the time for courtesy has passed and for action has come? The 
continuance of this courtesy plea can result in nothing else than 
the undue delay and ultimate defeat of the measure. 

1 for one hold and say there is no good reason for de'ay, and for 
one representing a constituency in which every farmer keeps cows 
and produces milk, and is directly or indirectly interested in the 
manufacture of pure dairy butter, enter my solemn i:)rotest against 
the dilatory action of this committee and demand a report. The 
very opponents of this measure can assign no good reason for 
withholding the measure from the consideration of the He use. 
an important one, one of great interest to the pub- 
whose decision affects the business of many thousands 
of our most industrious and most valued citizens. So it at least 
has a right to be discussed and passed upon by the House. 

If there are any intrinsic objections to this bill, if any of its 
provisions are unjust, if any can be improved, let these changes 
«93 



The subject is 
lie, and one wh 



be made by the committee and the bill then reported. The mem- 
bers of this House, I believe, are fully able to frame and pass a 
fair and acceptable measure on the subject-matter. Whatever 
may be said by the opponents, it is not fair that the legislation 
be stifled in committee or its enactment into law at this session of 
Congress be prevented by these dilatory tactics. I again warn 
the members of this committee and of this House that each one 
individually and the majority party collectively will have to an- 
swer for the defeat of this legislation, whatever be the excuse 
tliey may give. 

In behalf of my constittients, in behalf of those of your constitu- 
ents who have for days by letter, petition, and resolution pressed 
you to have this bill doing away with the illegal and unjust prac- 
tices used by the manufacturers of oleomargarine in their unfair 
and criminal competition with the pure dairy product passed, I 
appeal to you to redouble your efforts to secure a favorable report 
of the Grout bill and its enactment into a law before Congress 
closes its doors this session. 

Now, let us turn our attention to an examination of the merits 
of the Grout bill and to a discussion of the arguments urged by 
its supporters and the statements and criticisms of its antagonists. 

Let the position of those who favor this bill be not misunder- 
stood. They do not complain at their product, real dairy butter, 
being placed on the market in honest competition with oleomar- 
garine, butterine, or any chemical compound of grease, call it by 
whatever name the manufacturer may; but they do protest 
against these grease compounds being placed on the market and 
sold to purchasers and consumers for what it is not — the product 
of the dairy. 

The provisions of the Grout bill should plainly convince any 
unprejudiced thinking man that this is their only object, for al- 
though the Federal tax on oleomargarine and its kindred prod- 
ucts is at the present time 2 cents a pound, by this bill this tax 
will be reduced to one-fourth of 1 cent a pound — ^merely a nomi- 
nal amount— one which will enable these compounds to be sold 
for 1 J cents cheaper than its present price. 

But it does provide that all oleomargarine, the natural color of 
which is white, if colored to resemble butter shall pay a Federal 
tax of 10 cents. Why do the dairy interests ask the reduction? 

4403 



Simply because tbej' wish to sliow in a practical manner that they 
do not fear tlie honest competition of oleomargarine or any other 
grease so long as it has its natural color and must be sold in the 
open market for what it really is. 

W' hy do they ask the imposition of a high tax on the colored 
compound? Simply because if it is sold for butter, which it is 
not, it can not be sold at a price under which honest butter can 
be produced. 

These imitations, on an estimate based upon the market prices 
of the products entering into them and adding in labor, cost of 
production, and a fair profit to the manufacturer, can be pro- 
duced at from 8 to 10 cents a pound, while, on the contrary, every 
farmer or every man that has ever examined into the manufacture 
of dairy butter knows that at 18 and 20 cents the profit is merely 
nominal and during many seasons of the year it can not be pro- 
duced at that cost. Now, here let us examine what materials go 
in the manufacture of these compounds. They are the same, and 
in order that there may be no mistake about it I insert the answer 
given by the Secretary of the Treasury of the United States in 
reply to a resolution of this House asking for the information 
which under the present law the manufacturers are obliged to file 
in the Treasury Department, after swearing to the same. 

This return also shows the amount of these grease compounds 
manufactured during the year beginning June 30, 1898, and end- 
ing June 30, 1899. 

Quantities and kinds of ingredients used in the production of oleomargarine in 
the United States for the fiscal year ending June SO, 1,S99; also, the percentage 
cadi ingredient bears to the ivhale quantity. 



Materials. 


Pounds. 


Percent- 
age each 

ingredient 
bears to 

the whole. 


Neutral lard - - - .. 


31,297,251 

2-1,491,709 

4, 3.57, .514 

480,310 

148,970 

110,104 

8,903 

5, 890 

2, 5V) 

14, 200, .570 

0.7^3,070 

4. 342, 904 

1,568.319 

3.527,410 

91, "22,280 


34.27 


Oleo oil 


26.82 




4.77 


Sesame .- . .. ... .. .. 


.53 


Coloring; matter 


.16 


Sugar 


.13 


Glycerin 


.01 


Stearin 


.007 


Grlnco-so .. 


.003 


Milk 




Salt 


7 43 


Butter oil 


4.76 


Butter 


1.73 


Cream 


3.80 


Total 


100 







4193 



8 

When YOU glance over tliis long list of various articles it has a 
tendency to make even a stout heart quail. It is claimed that 
they are all healthy and easily digested. Perhaps they are; I hope 
they are. To me it looks like a rather nasty mixture, and I may 
be pardoned for preferring my butter to be made of the natural 
jnice of the cow. But I do not intend to discuss either the healthi- 
ness of the compound, its flavor, or its digestibility; others may 
discuss that part of the subject. 

If anyone will take up the list and put market prices on the 
several ingredients, the statement I have made as to cost of pro- 
duction can be easily verified; and that is the point I wished to 
make clear. The burden of the complaint of the supporters of 
this measure is that these products are fraudulently sold as dairy 
butter. Is this charge true? I have before m.e a circular letter 
mailed to me and haying the name of G. F. Swift, president of 
Sv^ift & Co., of Chicago. He states, " It is absolutely impossible 
to-day, under the internal-revenue laws and regulations, to sell 
oleomargarine as butter to consumers of ordinary intelligence." 
Is this ti"ue? No thinking, reading citizen will believe this state- 
ment. Certainly none living in Pennsylvania who has read the 
North American and other newspapers, which have daily during 
the last three months shown up the frauds practiced in the sale of 
oleomargarine in Pennsylvania alone. 

That State has stringent laws against the fraudulent sale of 
oleomargarine for butter, and severe penalties are attached; but 
even these laws it hasshown— and daily now is conclusively show- 
ing— do not prevent or deter the manufacturers of oleomargarine 
and their agents from carrying on a gigantic system of frauds. 
Over 11,000,000 pounds of this grease was sold in Pennsylvania 
alone, nearly one-eighth of the entire output of the United States 
manufacturers— fully one-eighth when the amount exported is 
taken into account. 

Was this so'.d as oleomargarine or butter? The answer may be 
found in the hundreds of indictments brought before the Federal 
courts against those who sold this trash for butter, and at butter 
prices. The cases tried conclusively proved that a mighty and 
extensive conspiracy existed, backed by the millionaire manufac- 
turers, to Bet the laws at defiance and swindle the consuming 
4433 



9 

public. These men, principals and agents, went so far as to 
guartmtee iznmunity from punishment to those who carried on 
this nefarious business and perpetrated unblushingly these 
gigantic and outrageous frauds. 

They went beyond this in their revel of lav^Iessness. They bribed 
the State authorities and officers who were supposed to have been 
appointed and who were paid out of the taxpayers' money for the 
purpose of detecting and punishing these offenders. 

Such a flood of light has been thrown upon this subject that 
the man who makes the statement that oleomargarine is not 
largely sold as dairy butter would be stamped as a modern Anna- 
nias, and would be admitted without further examination to the 
order of the knights of that name. 

It is hard to believe that the gentleman whose language I quoted 
above willfully made a false statement, but it is harder still to be- 
lieve that he has not "ordinary intelligence." The public must 
explain his statement. In charity I am willing to believe he haa 
been misinformed by the conspirators. Now, if a large part of 
the 11,000,000 pounds sold in Pennsylvania was sold as dairy but- 
ter—and when I iix that amount at 90 per cent 1 believe I place it 
within the bounds of truth— how much of the balance was sold in 
others States as the products of our dairies? Is it any wonder that 
the sales of these imitations have increased so rapidly? 

Let us look at this increase, boasted by the manufacturers. 

In the same letter Mr. Swift saj's— I read a portion of his letter: 

Fourth. Tlae annual report of the Commissioner of Internal Revenue for 
the fiscal j-ear which ended June 30, 1839 (pages 193 to 190, inclusive), furnishes 
much interesting and valuable iuformatiou on this subject. For instance, the 
average monthly production of oleomargarine in 18S8 was 2,800,400 pounds, 
while the average monthly production in 1899 was 6,928,335 pounds, showing 
an increase in production in eleven years of nearly 300 per cent. This in- 
creased production grew out of the increased market, and the increased 
market came because the people wanted and used oleomargarine. Daring 
the .same period the averege quantity withdrawn monthly for exportation to 
foreign countries increased from 140,516 pounds in 1888 to 258,003 pounds in 
1899. 

The following table of production from all oleomargarine sources for each 
fiscal year since November 1, 1880, the date the oleomargarine law took effect, 
is interesting as showing the extent of operations in the country, 
4493 



10 





JProduced. 


Revenue 
paid. 


On band Nov. 1. 1886 


Pounds. 
181,090 

21,. 513, 537 
34, 33.5, .537 
35, 664. 036 
33,334,033 
44.303,409 
48.-334,1.55 
07.224,298 
69,63,3,;246 
56,9.58,105 
50,8.53,234 
45,-531,207 
57, 516, 136 
83, 130, 474 




During the fiscal year ended June 30— 

1887 (from Nov. 1, 1SS6) 


$723,948.04 
864 139 88 


1888 


1889 


891 247 91 


1890 


783 £91 72 


1891 


1,077,924.14 
1,266, 326. CO 
1,670,613.50 
1.733,479.90 
1 409 211 18 


1893 


]S93 


1894.. 


1895 


1898 


1,319,432.46 
1,034,139.60 
>1, 315, 708. 54 


1897 


1898 


1899... 


1,956,618.56 




Total 


617,610,476 


1.5,943,101.43 





This table is taken from the report of the Commissioner of Internal Rev- 
enue above referred to, and is therefore authentic and official. It will be 
noted that the production has steadily increased until, in the year 1899, it 
amounted to 83,130,474 pounds. 

The Secretary of tlie Treasury's statement shows that the pro- 
duction of oleomargarine in the United States for tlie month of 
December, 1899, was 11,713,743 pounds. 

With these startling and unimpeachable figures, does any sane 
man wonder why the farmers of this country complain and ask 
the enactment of legislation which v\'ill only in a measure protect 
the dairy interests from utter annihilation in the very near future 
if the present fraudulent competition is allowed to go on. 

Every member, when he casts his vote on this measure, must 
decide whether he will wipe out the entire dairy interests of his 
district to allow the millionaire bogus-butter manufacturers of the 
United States to roll up more millions; for that and nothing else 
is what a vote against the Grout bill means. To you members of 
this body who represent Southern constituencies, where the cot- 
ton blooms, I ask you whether you are willing by your votes to 
strike down the great dairy interests of this countrj' in order that 
you may dispose of a few more gallons of cotton-seed oil than you 
otherwise would? 

Have you no regard for your friends among our people who, 
like you. are trying under the most adverse circumstances and 
discriminating laws to wring a livelihood by the hardest labor 
from the soil of mother earth? There are innumerable legitimate 
uses for your oil. Daily and hourly you arc gaining more ex- 

4193 



11 

tended markets for it among the people of the North and the 

East and the West, You need not fear for its present and its 

future— it has far better uses than a component part of bogus 

butter. 

To you I will quote froia Mr. Swift: 

Cotton-seed oil: This ingredieut is not always used; it is used in limited 
quantities in the medium grades. 

The statistics above quoted show you how much, irrespective of 
his assertions, is used. We, the friends of honest butter, ask your 
assistance. We ask you to take a broad and honest view of this 
subject and not be influenced by selfish and sordid considerations 
aloue, but by your sense of right and justice. Show us what 
Southern j ustice and generosity is. Prove to us that it exists, and 
you can never give us more conclusive proof than by the stand 
you take on this bill. This is a case of live and let live. What is 
your answer? 

To the Union Dairy Company, manufacturers of choice oleo- 
margarine, I say, as honest men, change your name; oleomai-ga- 
rine is not a product of the dairy, and your name is a fraud, and 
it suggests fraud to others who handle your product. To the Re- 
tail Merchants' Association of Illinois, I say to you that for every 
dishonest dollar you may put into your pockets by the sale of oleo- 
margarine for butter you pull five honest dollars out of the pock- 
ets of the trousers of the honest farmers who sell an honest prod- 
uct from the milk of their cows, and many of them live on the 
broad, grass-covered prairies of your own State, 

To the various trade and labor organizations who have honored 
me with their protests against the Grout bill I say you have been 
imposed upon by false statements and designing and unscrupulous 
men. No one can object to your eating imitation butter from 
choice. You can even buy it for less money than you do now if 
this bill is enacted into law. It will not be colored, it is true, 
yet the color adds neither to its taste, its feel, its odor, or its 
healthfulness. Surely the difference in price will pay for its 
looks. And then you must also remember that you and yours 
are subject to the same impositions that have been inflicted upon 
your fellow- workmen all over the United States. The workmen in 
any community do not wish to buy oleomargarine for real butter, 



12 

they do not want to pay two or three prices for these grease com- 
pounds. Stop a minute and think. Do you? 

Your plea that the passage of this bill will close the sixteen oleo 
factories and throw workmen out of employment is a weak one. 
It will not hear examination. Do you think these factories will 
be shut down? I would that this might happen, but it will not. 
They will surely not produce the quantity they do now, I grant 
you, and some workmen may lose employment there to find it in 
the manufacture of some honest product. But to every man that 
goes elsewhere for employment for this reason a score will find 
employment and a better living on our farms and in our creameries. 
Remember they are workingmen earning their living by the hard- 
est kind of manual toil. 

You could give the same reason for not interfering with the mar- 
keting of soapstone, whose product is mixed with the flour which 
goes into the bread j'ou and your families eat. So could you give 
the same reason for not shutting down the manufactories which 
produce any other adulterated food article which is sold for gen- 
uine. You are the sufferers; you are the direct beneficiaries of 
all pure-food legislation honestly enforced. Ask your wives; they 
will tell you so, if you do not believe my statements. 

This is no time for the workingmen of even Cincinnati, Cleve- 
land, or Chicago to give their assistance to the oleo or any other 
trust. You speak of butter trusts. Do you not know that such a 
trust is a practical impossibility? Cattle used for dairy purposes 
will not flourish in large herds. The actual labor of producing 
butter is too great for a trust to be even thought of. Thousands 
of farmers would by adding to their herd of cows break it down 
in a few short months. Do not strain at a gnat andswa'lowa 
camel. Honesty in this case is the best policy; and what is more, 
it is right. Many of us who are pressing for this measure have 
for years fought, and hope in the future to actively assist in fight- 
ing, your battles. They are many. They are opposed by money 
and the same kind of arguments as you bring forward against the 
butter interests. 

Had you not better consider before you ai-e used as the tools of 
the backers of these frauds? When the farmers of this country 
cease to give j'ou sympathy and assistance you will have a harder 
4193 



13 

fight to maintain your rights than you have ever had in the past. 
It will not pay to go back on these valuable allies, and I am glad 
to say your opposition is not general. It is confined to only a very 
few spots, and you do not talk for the great army of the employed. 

You ask me w^hy it should be permissible for the makers of 
genuine butter to color their product and not the manufacturers 
of oleomargarine. 

Mr. Swift ostentatiously boasts that they have colored oleomar- 
garine a rich yellow color for twenty-five years, as though that 
gave a prescriptive rr^ht to continue the practice despite the dis- 
astrous results. The reason I give you for prohibiting the color- 
ing of oleomargarine is that by coloring it you are able to and you 
actually do deceive the public. 

God Almighty gave butter its color — the grass He gave the cows 
to eat colored it yellow. If any distinction is to be maintained, it 
must be the natural color when that color is most pronounced. 
When it bleaches from the want of grass food in color, it could 
hardly be told from oleomargarine; and it is as much as anything 
to maintain the true distinction that they are compelled to color 
it, and they do color it. 

Butter, to my recollection, was never colored until it was brought 
into competition with these imitation competitors. The neces- 
sity for the passage of this legislation becomes evident when we 
call to mind that thirty-two States of the Union have enacted leg- 
islation to remedy this crying evil. They have from time to time 
by amendment made these laws more stringent. All action on this 
subject has been for greater protection and never for less — for 
heavier penalties and never for lighter. The people of these States 
by a large majority must have demanded and kept demanding 
this legislation, or these laws would never have been passed. 
Thereby they recognized the existenceof the evil and the necessity 
for action such as this bill contemnlates. 

The most platisible argument, and one which seems to have 
done more than any other in convincing some of the labor organ- 
izations of the cities named above that this bill is hostile to their 
interests, is that tlie enactment of this law will raise batter to an 
exorbitant price, which they fix as high as 50 or 60 cents a pound. 
Surely when oleomargarine pays 10 cents tax, and costs not more 
U93 



14 

than 10 cents, it would enter the competition coloretl at 30 cents a 
pound. Again, the increased production of butter, whicli will 
take place as soon as a small margin of profit appears, will be 
greatly increased, and this will in itself maintain the price at a 
point very nearly at the cost of its actual production. 

So I say to you your fears are groundless and you will be able 
to buy and eat genuine butter at a price no greater than or but 
very little greater than its present price. On principle no one can 
object to pay for an article its actual cost plus a fair profit, but 
we can object to iirofits being made exorbitant by resorting to 
fraudulent practices. 

In conclusion, let me say that the farmer's lot is a hard one; it 
means incessant toil of the severest kind; it means manual labor 
under the burning suns of July and August and in the drenching 
rains of March and April. His wife and every one of his grov^ing 
family must contribute their share to keep the wolf from the door. 
He suffers from drawbacks which come to no other occupation. 
At one time it is too much rain, at another it is too little; at another 
it is the fly in his wheat, the cholera among his hogs and poultry, 
or some other disease among his sheep or his cattle 

Hardly a season goes by that he must not face a substantial and 
unlooked-for loss. His taxes are high, and the owner of land 
and farm stock can not escape them, as does the coupon clipper. 
Profits never come to him in a great lump, as they do to the manu- 
facturer. Good years are only comparative to him, as his margin 
of profit is never large, and bad years are often as disastrous as 
they are to the manufacturer. Ease and luxury he knows little 
about. He is always the victim of tariff legislation, for he pays 
a tariff on even the imported grains which he sows. He pays the 
direct and indirect exactions of all tariff-taxed commodities which 
he is forced to consume. He is forced to sell in the markets of the 
world at a price fixed by his foreign competitor, and buy at pro- 
tection prices. 

He suffers most from freight discriminations. He contributes 
the largest part by far to the profits of all trusts. He has suf- 
fered from the fall in the price of lands. He pays the highest 
rates of interest for the money he is forced to borrow. He asks 
but little consideration at the hands of Congress; he asks them not 
diy3 



15 

favors, but only rights. In this measure he asks just and neces- 
sary protection, and he now awaits your answer. He is no slave; 
he owes no allegiance to trusts or corporations; he is not con- 
trolled. He is still a proud freeman, and he has the power and the 
nerve to punish a public servant who fails to do his honest duty 
and secure protection to liimself and the general public from au 
undeniable fraud practiced on them. Remember, "You can noc 
fool all the farmers of this country all the time." 
4i93 

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LJBRARY OF CONGRESS 




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Hollinger Corp. 
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